The $300 billion SaaS bloodbath last Tuesday wasn't a market correction. It was a preview of systematic economic dismemberment—the white-collar equivalent of watching factories shutter across the Rust Belt, except this time the factory is your spreadsheet, your inbox, and your entire professional identity.

Everyone keeps calling this a "shift." A "reallocation." Market evolution. Bullshit. This is a controlled demolition of the knowledge worker class, and we're all pretending the explosion is a fireworks show.

The Lie We Keep Telling Ourselves

The prevailing narrative—the one Don Muir articulates beautifully in Forbes, the one being repeated in every VC memo and earnings call—is that AI expands the market. That software isn't disappearing, just "evolving." That value is being "reallocated" to more efficient systems.

Technically true. Morally bankrupt.

Yes, the market grows. Yes, new value gets created. But here's what no one wants to say out loud: that value doesn't employ you.

When Goldman Sachs projects that 60% of software economics will flow through agentic systems by 2030, they're not describing job creation. They're describing job evaporation. Those "adaptive systems that operate across tools" aren't hiring. They're replacing.

Every dollar that shifts from SaaS seats to AI execution is a dollar that used to pay a middle manager, an analyst, a coordinator, a specialist. That entire layer—the people who extracted data, wrote memos, reconciled reports, managed workflows—they're the assembly line workers of this transition. And just like in manufacturing, we'll be told this is progress right up until the unemployment checks start clearing.

We've Seen This Movie Before

The parallels to industrial automation are so obvious it's insulting that we're pretending otherwise.

1980s-2000s: Manufacturing

• "Automation will make us more productive"
• "Workers will upskill into better jobs"
• "The economy will adapt"
• Reality: Entire regions economically destroyed. Opioid crisis. Decades of wage stagnation. Political radicalization.

2020s-2040s: Knowledge Work

• "AI will augment workers, not replace them"
• "People will focus on higher-value tasks"
• "New jobs will emerge we can't even imagine"
• Reality: You're already seeing it.

The private equity associate pulling all-nighters in Excel? Gone. The junior analyst building decks? Obsolete. The operations coordinator managing workflows? Redundant. The entire scaffolding of entry-level and mid-tier knowledge work that used to be a pathway to expertise and income security is being systematically automated away.

But this time it's worse, because knowledge workers don't have unions. They have LinkedIn learning courses.

The Economics Are Fucking Brutal

Here's the part that should terrify you: AI doesn't need to be better than you. It just needs to be 80% as good and cost 5% as much.

Traditional SaaS economics created jobs because implementation required humans. Customization required consultants. Maintenance required support teams. Integration required developers. Sales required enterprise reps. That entire services layer employed millions of people making good money.

AI collapses all of it.

When F2 says they're "eliminating labor-intensive processes wrapped around" core systems, that's not corporate speak. That's a pink slip for everyone who used to perform those processes. When they celebrate "replacing offline human workflows," they're celebrating making people obsolete. When they talk about "higher return on decision-making," they mean fewer humans involved in making those decisions.

This isn't cynicism. It's just math.

Goldman's research shows the profit pool shifting to agentic systems. Profit pools shifting means expense pools shifting. And the biggest expense in knowledge work is people. That's the whole point. That's the actual business case. Everything else is marketing.

The Wage Collapse No One's Pricing In

Even if you keep your job, you're fucked.

When AI can do 60-70% of what entry-level and mid-tier knowledge workers do, what happens to wages? Supply and demand isn't a suggestion—it's gravity. If ten people are competing for positions that used to employ a hundred, those jobs pay less. A lot less.

We're about to see knowledge worker wage compression that makes the last 40 years of middle-class squeeze look gentle. Because unlike manufacturing, where you could plausibly retrain into another field, every field is getting hit simultaneously. Finance, legal, marketing, operations, consulting, research—AI is horizontally integrated across cognitive labor.

Where exactly are you supposed to "upskill" to when the skill ceiling keeps dropping?

The people building these systems will tell you: "Learn to work with AI! Become an AI specialist!" Right. Because history shows us that when technology eliminates 90% of jobs in a sector, 90% of those workers successfully transition to maintaining that technology. Just ask all those former factory workers who retrained as robotics engineers.

Oh wait.

The Social Unraveling We're Not Preparing For

Here's what genuinely keeps me up at night: the social contract of modern capitalism assumes employment.

Healthcare, retirement, status, identity, community, purpose—all tied to jobs. Not just any jobs, but "good" jobs. Professional jobs. The kind knowledge workers have spent their entire lives believing they'd earned through education and skill development.

When manufacturing collapsed, we got:

• Geographic decimation of entire states
• Intergenerational poverty
• Public health crises
• Political extremism and institutional distrust
• The complete collapse of social cohesion in affected regions

That was 15-20% of the workforce, concentrated geographically, over 30 years.

Knowledge work is 40%+ of the economy, distributed everywhere, and the transition window is maybe 10 years. The social instability this will create isn't a bug—it's the entire operating system crashing.

The Uncomfortable Truth About "New Jobs"

Yes, new jobs will emerge. They always do.

But they won't employ the same number of people, they won't pay as well, and they won't provide the same security.

That's the dirty secret of technological progress under capitalism: aggregate wealth increases while median prosperity declines. The economy grows. GDP goes up. And your cousin with the accounting degree is driving for DoorDash because AI can close the books faster and cheaper than he ever could.

The economists will point to historical precedent—the Luddites were wrong, horses found new jobs, we adapted before and we'll adapt again. Except horses didn't find new jobs. The horse population collapsed by 90% once cars arrived. The Luddites weren't wrong about their jobs disappearing; they were just wrong about being able to stop it.

Who Actually Wins

Here's the only honest forecast: The people who own the AI win. Everyone else negotiates the terms of their surrender.

If you're a SaaS founder, you're facing commoditization and margin compression until you either pivot hard into agents or get acquired for pennies on the dollar by someone who did.

If you're a knowledge worker, you're entering a 10-20 year squeeze where your value proposition deteriorates annually while your expenses don't.

If you're a VC or PE investor still underwriting based on pre-AI assumptions about revenue durability and human capital requirements, you're holding tomorrow's stranded assets.

And if you're the median American who thought a college degree and professional job was their ticket to the middle class? You're about to learn the same lesson manufacturing workers learned: the economy doesn't owe you a comfortable life just because you played by the rules.

What We're Not Admitting

The market is repricing SaaS because investors see this coming. The $300 billion selloff is them frontrunning the realization that software-as-a-service becomes infrastructure-as-a-commodity once intelligence is portable.

But they're still underpricing it. Because the second-order effects—the wage collapse, the unemployment crisis, the social unraveling—aren't yet in the models. They will be.

We're in the quiet part of the transition. Where the technology exists but adoption is still ramping. Where people can still pretend this is about "augmentation" and "productivity" rather than elimination and cost-cutting.

That window is closing.

Five years from now, we'll look back at 2025 the way we look at 2005 for manufacturing: the last moment where you could plausibly deny what was coming. The last time the pain was still theoretical for most people.

So What Now?

I don't have a good answer. Neither does anyone else, they're just better at pretending.

Maybe UBI. Maybe mass retraining programs that will fail like every mass retraining program before them. Maybe political upheaval that forces wealth redistribution. Maybe we just accept a permanent underclass of economically obsolete humans and hope the social fabric holds.

What I know for certain: the same people telling you this is an opportunity are the ones building the systems that will eliminate your job. Their incentives are not aligned with yours. Their "expanded market" comes at the expense of your labor market.

The Great SaaS Meltdown isn't the end of software. It's the beginning of something much bigger and much darker: the systematic unwinding of the knowledge economy as a source of middle-class employment.

Chamath was right that there's no going back.

He just didn't mention that most of us aren't going forward either.

We're just going out.

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